How Henry the Hatter defied disruption, prepares for new beginnings

New location offers more customers than possible at old Broadway Street store downtown

Over the next 10 years, Paul Wasserman will gradually sell the business to his longtime associate

Corey Lamont Photography

Paul Wasserman assists a customer trying on a hat at Henry the Hatter in downtown Detroit. Wasserman told Crain's: "We have so much merchandise on the shelf. I don't want everyone to leave with the first thing they try on. We don't want to sell a hat, we want a customer for life."

Sometimes, change is good.

Most of the time it can be inconvenient, frustrating, daunting and every other negative descriptor in the book. But in the end, disruption can be worth it and reveal what's possible.

That's been the case for longtime Detroit hat seller Paul Wasserman, who has run the family-owned Henry the Hatter for nearly five decades. The retailer, which was confronted with change a little more than a year ago, operated at the corner of Broadway Street and Gratiot Avenue for 65 years until rising downtown rents forced Wasserman to consider closing shop or move into a new home. Four months later, Henry the Hatter migrated about a mile away to Eastern Market.

Deciding to pack up was the frustrating part for Wasserman, who owns several display cases that are 8 feet tall and 7 feet wide.

"At one point we had things stored in five different locations," he said.

But the move, indeed, revealed to Wasserman what's possible. Since reopening the iconic business in the popular Eastern Market in December, Wasserman said sales are up 15 percent. He also credits media coverage for boosting the number of shoppers who have visited his hat store.

"The only month that hasn't been better than what we had at the old location was February," he said. "It's been a complete positive in revenue, foot traffic and any other way."

Photo

Tyler Clifford/Crain's Detroit Business

Since closing down its shop in downtown Detroit a little more than a year ago, Henry the Hatter has seen its sales increase by about 15 percent after reopening in the historic Eastern Market.

Henry the Hatter has taken advantage of the crowds that visit the historic Detroit market, particularly Saturdays. The marriage between the two organizations, whose foundings predate the launch of Detroit's iconic Big 3 automotive companies, seems fitting. Both opening in the early 1890s, they rank among the city's longest operating businesses.

While downtown Detroit booms, Wasserman is not concerned about what Broadway Street could offer.

"We never would've seen the traffic that the market provides. We would've been going along business as usual not knowing what was out there beyond Broadway and Randolph," he said.

Following Henry the Hatter's departure, the neighboring J.L. Stone men's clothing store has since closed. Those closures were preceded by Serman's on Randolph Street, which closed in 2013.

Wasserman said the three fashion shops, which he described as clothing stores "not good enough" to be on the prime shopping strips of Woodward Avenue and Washington Boulevard, had a definitive style for the common man and fed clients to one another. Being there together made it easy to succeed, he said.

Today, each of those buildings sits vacant, along with three others that line Broadway between Gratiot and Grand River avenues.

Dan Gilbert's Bedrock real estate company owns the former J.L. Stone and Serman's buildings, while the former Henry the Hatter storefront is owned by Gary Torgow's Sterling Group of Detroit.

Developer Roger Basmajian, who bid for the three vacant Broadway properties from the Detroit Downtown Development Authority, in 2016 proposed an $11 million project to add 30 apartments, office and restaurants slated to be completed in 2019. Yet, there appears to have been no activity at the properties totaling about 26,700 square feet.

Wasserman said he just hopes rents will be made affordable for smaller businesses to thrive, saying "if nobody makes money except the landlord, then it's not a good thing."

"I don't know what [Gilbert and Torgow] are thinking about doing with the buildings, but I hope they are happy with what they have. I'm very happy with what I have."

Trying new things

With more feet walking into the quasi-museum hat store at 2472 Riopelle St., Henry the Hatter is trying a new selling point for a potential new customer: women.

The store has been selling new unisex hats that Wasserman said uncovered a new market for the old hat store. That unisex hat, he said, gained a lot of interest from woman shoppers, who bought the headpiece more than men.

So now the businessman is testing the water to sell hats for women.

"We're not going to jump in with both feet just yet, but we are going to wade our way in the water," Wasserman said. "Right now we are at knee length and hopefully we'll be at waist length at the upcoming [fall] season."

Joe Renkiewicz, 55, a longtime Henry the Hatter associate who manages the Southfield store near 10 Mile and Greenfield roads, said their core business is among the 40-year-old and up crowd, but more millennials have shown interest.

"We're getting a lot of 24- 40-year-olds who want to be an adult now," Renkiewicz quipped. "We're seeing an upsurge in younger guys wearing them."

To handle growing demand, Henry the Hatter could add about three more to its staff. Wasserman said the Eastern Market store is at least a four-person store, while the smaller Southfield store can run by two-three people.

While the business is not shying away from horizontal growth, it's important that it maintains its integrity as a hat seller, Wasserman said. He knows it needs to specialize in hats and keep its niche. In the late 1950s, then under his father's leadership, Seymour Wasserman considered adding leather jackets to its offerings. Paul, a teenager at the time, thought better of it.

"My original thought, as a purist, was 'if you're a hat store, be a hat store,'" Wasserman recalled. "I didn't take it that seriously, but he took me seriously and we've been a hat store."

That helped Henry the Hatter, and in turn Wasserman, be an expert hat retailer and build a loyal customer base.

It's about providing an experience, Wasserman stressed.

"Our hands-on approach has always been just that and that's why we are still here," he said. "We have so much merchandise on the shelf. I don't want everyone to leave with the first thing they try on. We don't want to sell a hat, we want a customer for life."

Gradually changing hands

Now 71 years old, Wasserman spends four days a week at the shop in Eastern Market and vacations for months each year in Florida. With each new year, he plans to spend less time in the store.

Photo

Corey Lamont Photography

Joe Renkiewicz is the 55-year-old managing partner of Henry the Hatter. He manages the company's smaller store in Southfield. Over the next 10 years, Renkiewicz will gradually buy the family-owned business.

That's because the hat seller, whose career spans 46 years, has made a deal to sell the family business and retire in the next decade. Renkiewicz, the associate at the Southfield store, will be the successor. A contract, which was made in April, calls for Renkiewicz to buy the business over the next 10 years.

"It's going to be a slow process where I will be active for hopefully five years," Wasserman said. "He knows a lot and he's the perfect guy to take over, but there are a few things to teach him."

Chatter about selling the business started about four years ago, Renkiewicz said, but gained more steam in the past year when Wasserman was confronted with losing the Broadway store. Renkiewicz talked it over with Wasserman's son, who had no interest in taking over the family business, he said.

"Paul was going to just close the Detroit store and sell me the Southfield store," he said. "It gave me time to think about it. I thought a Detroit store needed to stay open because of that history.

"When I told him yes, with the condition we had a store in Detroit, we started looking for new stores in the Detroit area."

Renkiewicz, a Hamtramck native and father of two, lives in Clarkston with his wife.

Wasserman is sticking around to train Renkiewicz the business of hats, which is a part of his "easing my way into retirement." The contract stipulates that Wasserman will work three days a week in 2019, two days a week in 2020 and as needed down the line.

Ownership will transfer 10 percent each year over 10 years.

"He'll work for five and I'll pay him the last five," Renkiewicz said. "If profits are good, I may pay him off earlier."

The men declined to disclose the selling price and revenue of the company.

Wasserman, a Detroit native who grew up in the city's northwest area, lives with his wife, Cathy, of 32 years in Farmington Hills.

No matter what other unforeseen changes may come to Wasserman's doorstep in the future, the veteran hat seller should be up for the challenge. He can rest assured knowing that he led a company that was built to last.

Editor's note: A previous version of this story mistated Paul Wasserman's age. This version is correct.